from the double-irish-with-a-dutch-sandwich dept

For quite some time now, we've seen EU regulators talk fairly openly about their desires to harm American internet companies, mostly in a misguided attempt to boost local European companies (and to collect more money). It's why we keep hearing about weird, carefully targeted regulations designed to pump up how much money companies like Google, Apple and others pay.

At the same time, parts of Europe (Ireland, in particular) have been doing basically everything they can think of to woo American tech companies. Ireland has successfully offered ridiculously friendly policies, leading many large internet companies to set up offices in Dublin, and then use that as the place where they "recognize" all their revenue. There are a variety of tax dodges employed here, which go by fun names like Dutch Sandwich and Double Irish.

US Companies have been doing this for many years, and while it (frankly) looks pretty sleazy, they do seem to mostly play by the rules. We can argue over whether or not the tax breaks they get are worth it, but the whole thing just feels sketchy in that it's clearly playing some jurisdictional games to get lower tax rates. Of course, there's also been another looming issue on all of this, which is that these giant internet companies have been pushing heavily to be able to get the cash that they've been accumulating in Ireland back into the US, without then having to pay all those taxes on it. So they've been pushing for some sort of "amnesty" period or "holiday" where they can bring the cash back in.

Frankly, the whole thing is a little ridiculous. With so much money on the line, you can see why these companies play games, but that still doesn't make it right. The internet giants often seem to put this issue at the top of their lobbying priority list, and that's unfortunate. The thing that I like about Silicon Valley is that much of the industry comes from actually creating new and useful things and building stuff up. Playing tax dodging games is the opposite of that. It's playing political games and it feels super counterproductive.

Apple Inc. was ordered to pay as much as 13 billion euros ($14.5 billion) plus interest after the European Commission said Ireland illegally slashed the iPhone maker’s tax bill, in a record crackdown on fiscal loopholes that also risks inflaming tensions with the U.S.

The world’s richest company benefited from selective tax treatment that gave it an unfair advantage over other businesses, the European Union regulator said Tuesday. It’s the largest tax penalty in a three-year campaign against corporate tax avoidance. Apple and Ireland both vowed to fight the decision in the EU courts.

No one comes out of this looking very good. The tech companies playing tax haven games look bad -- even if you think the tax rate is too high and they should be trying to get it lowered. The EU government looks typically jealous and petty towards American companies. And of course, people are already talking about a possible trade war over this issue.

Frankly, I'd much rather tech companies be focused on innovation in their products, rather than in their tax strategies.

from the tax-ALL-the-things dept

Back in July we noted how the city of Chicago was hoping to cash in on streaming services by imposing a new tax on Netflix. Blind to the negative impact such taxes can have on emerging economies, Chicago proudly proclaimed it would be expanding its 9% "amusement tax" authority (traditionally covering book stores, music stores, ball games and other brick and mortar entertainment) to cover any service that interacts with the cloud. While the new ruling was supposed to technically take effect September 1, Chicago recently announced it was postponing portions of the new tax until next year to field criticism and manage plan logistics.

While Chicagoans wait, the city's now on the receiving end of a new lawsuit (pdf) by the Liberty Justice Center, which claims that Chicago is violating the law in two ways. One, the lawsuit claims that the city aldermen violated city rules by not holding a full vote on the changes. Two, the lawsuit states that Chicago's tax grab also violates the Internet Freedom Tax Act, which prohibits local, state, and federal governments from enacting "internet taxes." The plaintiffs are quick to note that actually putting the idea to a public vote likely wouldn't end well for the city:

"No aldermen voted on this tax. It never went before the Chicago City Council, which makes the so-called 'Netflix tax' an illegal tax," Jeffrey Schwab, an attorney with the Liberty Justice Center, said in a news release Thursday. "If the city wants to tax Internet-based streaming media services, then it should put the measure through the political process, and let Chicagoans have their voices heard through the democratic process."

Should Chicago's plan even survive the lawsuit, it remains unclear how the city plans to collect the tax. Would it demand that Netflix and Spotify tax users themselves, even if they have no physical presence in the city proper? Would Chicago residents be required to report this revenue (which they either won't do, or would hide behind VPNs)? Chicago's just one of many cities taking this controversial tack as traditional revenue runs dry, creating an absolutely mind-boggling legal minefield for new economy companies suddenly facing an ocean of discordant and often logically and legally inconsistent attempts to tax the cloud.

from the coming-for-brains-and-eyeballs-next dept

We've covered copyright levies (a.k.a., "you must be a pirate/thief" taxes) several times here at Techdirt, with a majority of them pertaining to the cassette tapes of the digital world: blank CDs/DVDs, hard drives, removable storage, cell phones, internet connections, etc. The theory is that the only reason anyone buys storage of any kind is to have some place to put all their pirated goods. Hence, they must pay a "tax" to compensate artists for all the creative works they've ripped off.

This sort of taxation is stupid, but governments often fall for it because it's obvious that, yes, some people do store their pirated goods this way. That a large majority of people don't doesn't seem to matter. They, too, must pay a tax for the overall good of the creative world -- a "world" that is basically a bunch of industry groups and collection societies when you get right down to it. They're the ones pushing these levies, and they're the ones that derive the most benefit from them.

Reprobel, a collecting society, had asked HPB to pay a levy for the sale of multifunction printers. Such a levy is due as fair compensation to authors for the copying of their work using the devices. Since Reprobel and HPB did not reach an agreement on the amount to be paid, HPB sued Reprobel so as to obtain legal certainty on the royalties due.

Reprobel's theory is more than a bit shaky. It assumes multifunction printers are used to copy hard copy books (and convert them to digital/physical form). Reprobel doesn't explicitly spell out the "harm" it is seeking compensation for (at least not in this article by Peter L'Ecuse), but it's assumed that copying and printing both theoretically aid in the pirating of printed material.

What's more surprising than this leap of logic is the fact that such a levy is already being collected.

Under Belgian law, the fixed part of the levy is paid by manufacturers/importers (Article XI.235 of the Code of Economic Law and is based on potential harm caused to the author. According to the Advocate General, such a levy is proportionate and the criteria used to determine the levy (i.e., the maximum speed for copying in black and white) objectively reflect the ability of the equipment to potentially prejudice authors.

So, the Belgian courts have already found in favor of these sketchy assumptions and have applied them to sales of standalone copiers. Reprobel is seeking the application of this levy to printers that also make copies. In addition, it's seeking another levy, supposedly based on "actual harm." (The current levy is based on "potential harm.")

The Belgian Advocate General is at least questioning a few of Reprobel's assertions.

[T]he Advocate General pointed out that it is likely that a private person using a multifunctional printer for his own personal use will cause less harm to authors than printers of the same speed used in libraries or copy shops. The Advocate General therefore believed that the fair balance would be better guaranteed if criteria other than the maximum speed were also taken into account.

Of course, the Advocate General's questioning begins with a questionable assumption: that printers/copiers are used to facilitate enough infringement that a levy is somehow justified. If Reprobel's worry is the mass copying of physical books, then it has had several years to gather data that supports its assertions about copyright infringement. Nothing in this report or the comments by the Advocate General suggest it has presented anything of the sort.

Using an all-in-one printer to make infringing copies of digital books is about the least efficient form of piracy imaginable. Using off-the-shelf all-in-ones to scan books into PDF form for distribution across the web is only slightly more efficient. And even if it's the latter form that concerns Reprobel more, there's evidence out there that suggests there's very little demand for pirated books.

Just 1% of UK internet users aged 12 and over read “at least some” ebooks illegally between March and May 2015, according to the Intellectual Property Office’s study into the extent of online copyright infringement in the UK. This compares favourably to other forms of entertainment, with 9% accessing some of their music illegally, 7% television programmes, 6% films, and 2% computer software and video games.

When researchers looked at “all internet users who consumed content online over the three-month period,” (rather than all internet users over 12), they found that 31% accessed at least one item illegally. Readers, however, still had the lowest incidence of illegal access, at 11%, compared to 25% for people watching films and 26% for people listening to music.

“More ebook consumers paid for some content (69%) and for all of their content (47%) than consumers of any other content type”, the survey found.

Reprobel appears to be interested in collecting fees (this is honestly where this sentence should end, but…) on the sort of infringement that went out of vogue well before all-in-one printers became mainstream.

The Advocate General does raise a couple of good points during its consideration of Reprobel's plea, despite giving far too much credence to its assertions.

[T]he Advocate General expressed doubts as to the admissibility of the dual fixed and proportionate levy. Indeed, given that the proportionate levy paid by the user is deemed to compensate for the actual harm, the Advocate General sees no reason to add a fixed levy to be paid by the manufacturer/importer to compensate for a potential harm caused by the same equipment.

If a proportionate levy is granted, the AG suggests that any compensation demanded by Reprobel for actual use should have any levies collected for potential use deducted. This will prevent Reprobel from doing too much double-dipping, even though the proposed levy is a double-dip in and of itself.

Furthermore, the Advocate General reminds Reprobel that not all copies of copyrighted content are infringing.

In particular, the Advocate General held that the system does not distinguish between copies of works that fall under the fair compensation scheme and works for which no levy is due because of an exemption foreseen by the InfoSoc Directive (e.g. sheet music copies can be made without any fair compensation being due).

Beyond the Belgian version of "fair use," there's the question of how Reprobel expects to apply a proportionate levy based on actual usage -- at least not one anyone's going to agree with. What percentage of actual usage is it going to automatically assume is infringing? And how is it going to collect this data?

The Advocate General says the fee could change depending on the end user's level of cooperation with Reprobel in the assessment of the levy. This would basically turn Reprobel into the BMI of the printed world -- an entity that demands fees from businesses utilizing multifunction printers. It would give it the power to basically charge a licensing fee for printer/scanner/copier operation. The AG's echoing of Reprobel's assertion that every sold multifunction printer will generate some sort of actual harm points towards Reprobel being granted this power. If this goes Reprobel's way, there will no need for it to prove actual harm. It will be free to collect on its assumptions.

from the tax-the-future dept

Almost exactly three years ago, Mike wrote up a post that discussed Planet Money pulling together five economists with differing political views to see what they could all agree on. The result was several policy ideas that appeared to transcend politics if economics was the driving motivator instead of any kind of partisanship. The whole post is awesome, and has influenced my thoughts on economic policy and taxes to a large degree, but I came away from it with one general concept firmly in mind: tax what you want to discourage, don't tax what you want to encourage, and never tax innovation or the future.

A ruling by Chicago’s Department of Finance allows the city to add an extra nine percent tax onto “electronically delivered amusements” and “nonpossessory computer leases.” In an odd combination, buying a subscription to streaming media, such as Netflix or Spotify, would qualify, as would using a cloud computing platform, such as Amazon Web Services. Each would be subject to 9% tax; Chicago is the first major American city to levy a tax on either streaming services or cloud computing services.

Amusement taxes in and of themselves generally violate the concept I highlighted in the opening. After all, if you're a municipality, taxing fun is essentially saying you want less fun. But what makes this re-write of the amusement tax already on the books silly is that it is purely a money-grab. Here's what happened: the amusement tax in Chicago worked primarily to collect revenue from book stores, music stores and movie rental stores, which are obviously becoming increasingly in short supply as consumers move to online stores and streaming services like Netflix and Spotify and Amazon for all of the above. This is actually a good thing from a public interest standpoint for a variety of reasons: less pollution from physical products, more efficiency in the marketplace, the opening of more creative outlets for members of the city, and more access to more content from more places and devices, meaning a more robust economic marketplace. The future, in other words, although increasingly the present as well. And Chicago wants to tax all this, effectively discouraging its use, in order to collect an additional $12 million a year.

Chicago, mind you, is in the hole for roughly one hundred times that amount.

Cities with amusement taxes have lost revenue as more people forgo book stores, record shops and video rental stores in place of online outlets. But $12 million isn’t going to be much more than a drop of water in the bucket of the city’s $1 billion operating shortfall.

Fighting the future doesn't even yield much of a reward, so why do it at all? Don't tax what you want to encourage and tax what you want to discourage. This makes it look like the city of Chicago really wants a tax policy to make the city operate like it was 1995.

from the northern-fights dept

We recently wrote about recent developments in Canada regarding the Canadian Radio-Television and Communications Commission looking to apply the same "culture tax" to Netflix and other internet services as is done to broadcasters of television programming. In case you're not aware, there are taxes in place in Canada, which broadcasters of mostly foreign (read: American) programming are required to pay, that go into a fund supposedly used to create more "Canadian" content. If that sounds strange and convoluted to you, you're not alone, but more on that later.

It appears as though things are getting a bit testy, with members of the CRTC Commission requesting Netflix hand over data on its subscribers, the content they watch, and hosted "Canadian" content, all while refusing to protect that proprietary information from the competition's eyes. Needless to say, Netflix refused.

A Netflix executive told the country's broadcast regulator on Friday before being ordered to hand over the confidential company information that regulating the internet to help boost Canadian content will only hurt consumers. In an occasionally tense appearance before the Canadian Radio-television and Telecommunications Commission, Corie Wright urged the broadcast regulator to let market forces dictate what consumers can watch.

Chiefly at issue was the Canadian government's refusal to affirm that it would keep Netflix's data confidential. In other words, the government was asking a private company to hand over sensitive business information with no assurance that the information wouldn't then end up in the hands of surely interested competitors. They might as well have asked the company to punch itself in the crotch, for all the sense it makes. All this, keep in mind, is geared towards determining if that committee will levy a tax on Netflix for the sin of having a lot of content Canadian consumers really want. Screw the market forces, just prop up our own culture from the outside.

And that really makes no sense. First of all, if Canadian content is bought and paid for with American dollars, how Canadian is it, really? It's practically begging for cultural diffusion, the very thing the tax is supposed to stave off. And the whole concept leads to some really silly comments, such as:

"Netflix's kind of late-1990s view of the internet as some unregulatable space was dragged into the 21st century and was put on notice," said Carleton University journalism professor Dwayne Winseck, who characterized Wright's appearance as "theatre." "The CRTC has a Broadcasting Act to live up to and Netflix ... has to have a respectful conversation in that light."

Ah, yes, the CRTC wants to pretend that the internet is a walled broadcasting system, like television, and it's Netflix that is living in days gone by? Beyond that, think of this from Netflix's point of view. The CRTC falls under the jurisdiction of the Canadian Parliament. It's government, in other words, answering to the Minister of Canadian Heritage, who is in turn responsible for Canada's arts, culture, media and sport. So, put simply, the part of the Canadian government that is responsible for encouraging the creation of Canadian arts and culture instead is saying, "Fuck it, just make Netflix do it."

And you can understand why. After all, actually doing the work themselves in creating a cultural marketplace, in fostering the Canadian arts, in promoting the education and training of film-makers and artists such that their work is desired by the Canadian public, sounds quite complicated. Telling someone else to do it for you must be much easier.

from the yikes dept

We've covered a few attempts in Europe to create what appears to basically be a tax on Google News for newspapers. These newspapers, who have been struggling to adapt in the modern internet world would like to blame Google News for their own failures, despite the fact that Google sends them traffic. When a court case in Belgium was won by the newspapers, Google simply removed those newspapers from the local Google News... and those very same newspapers freaked out and demanded to be let back in. This, of course, demonstrates the vast hypocrisy by the newspapers here. They know they need to be in Google News because of all the traffic it drives, but they also demand to be paid for it. Google has made it quite easy for newspapers to opt-out of Google News if they really feel like their work is somehow harmed by having Google link to it -- but none of the newspapers use it, because they know how valuable the traffic is. In fact, many of the same newspapers who are complaining are, at the same time, using Google's own tools to improve how they appear in results.

But the situation over in Spain just got even more ridiculous. Julio Alonso has the details, in which it appears that the lower house of the Spanish legislature has approved a very, very dangerous bill that creates a brand new inalienable right for news publishers to be paid for, via compulsory licenses, any "electronic news aggregation system," which is broadly defined as anyone who shares more than just anchor text with a link. A short summary? You'll have to pay up:

The Spanish law proposal declares that editors cannot refuse the use of “non-significant fragments of their articles” by third parties. However, it creates a levy on such use to compensate editors and declares it an inalienable right (derecho irrenunciable).

The introduction of the inalienable right was done to avoid what happened in Germany. If you are a digital editor that publishes with a copyleft license, like myself, and you minimally understand how the internet actually works, you cannot decide to not charge Google News. It is compulsory. More than a right it is an obligation. Therefore, Google cannot exclude sites requiring payment from Google News. It would still need to pay for those it includes, even if they do not want to be compensated.

Furthermore, such tax, is to be administered by a third party (entidad de gestión) in a similar way to what SGAE (the Spanish RIAA) does with music rights. In this case most likely CEDRO (the entity that collects fees for the use of written text, photocopies and so on). How much it is to be paid and how the proceedings would be split among editors has not being disclosed. Though there is reason to suspect of a distribution just to AEDE members.

To make things even worse, the tax is not even aimed only at Google. It is aimed generally at “electronic news aggregation systems”, and, therefore it includes basically anyone who links with anything more than an anchor text.

It seems worth noting here that collection societies around the globe have been plagued with corruption and other problems, often diverting money from smaller creators to the biggest. And, some of the worst stories come from Spain, where SGAE was accused of mass corruption, involving stealing $550 million from artists. That doesn't bode well for this new "organization."

As Alonso notes, this isn't just directed at Google News, but Menéame, a popular Digg/Reddit-like aggregator in Spain (randomly: we get a fair amount of traffic from that site). But it could also impact Twitter and Facebook where people share links with text. And also a variety of other aggregators like Flipboard, Zite and Pocket.

The fact that it's considered "inalienable" is especially troubling. It basically overrides any concept of fair use, Creative Commons or even public domain material. Furthermore, Alonso notes that a bunch of organizations, including a bunch of other newspapers, are fighting against this, but it didn't seem to matter. A report has warned that implementing this law could cost the Spanish internet industry over a billion euros, and sites like Menéame are already talking about leaving the country. There are rumors that Google might just shut down Google News in Spain over this. But, still, the legislation was pushed through under questionable circumstances:

The law was passed on Congress in a special session in the mid of summer, on the Culture Committee and not on the plenary session, with almost no debate in a very awkward session, with many Congressmen declaring to the press, sometimes unintentionally, that they knew very little about what they were voting.

Despite widespread public and industry (outside the largest Spanish newspapers) opposition to this, Alonso suggests that the bill is still likely to become law. And we'll have yet another disastrous policy for the internet, designed to protect the industry of a few legacy players who failed to adapt.

from the innovation-tax dept

Obviously, there have been an awful lot of patent lawsuits in the past few years concerning smartphones and various software and hardware associated with smartphones. The folks over at law firm WilmerHale have now released a paper, which conservatively (and thoroughly) estimates that the patent royalties that need to be paid by smartphone manufacturers currently exceeds $120 per device -- which they note is right around the price of the components themselves (found via FOSS Patents, which notes that the estimates in the paper almost certainly lowball the patent royalties, so they may be much higher). Basically, more than half the cost of making a smartphone these days is in paying off patent holders.

The authors of the paper are pretty clear that they don't even have data on many other parts of the smartphone where patent holders have demanded licensing payments, meaning the number is probably actually higher. Though, on the flipside, they admit that some companies likely negotiated lower rates in private than the "headline" rates that were publicly revealed. Either way, the $120 estimate is likely fairly conservative.

Talk about a massive tax on innovation -- that all of us are paying for.

And, of course, many of these fees are going to pure trolls, who have contributed nothing to making actual smartphones. The paper highlights the explosion of troll lawsuits in the past few years:

Though, to be fair, some of that is because of the America Invents Act of 2011, which made it more difficult for trolls to file a single lawsuit against multiple defendants, meaning that many started more lawsuits against individual defendants.

Either way, this should be seen as a massive problem. Rather than going towards innovation and better, more affordable products for the pubic, money is going to lawyers and patent trolls who have contributed nothing to society. It's a massive dead weight loss to the economy.

from the this-again? dept

French politicians had been pushing for years to extend its infamous "you must be a pirate" copyright levy (tax) to tablets, and it appears that's now in place. Apple has been ordered to pay €5 million for all the copying supposedly going on via tablets. Apple pushed back, pointing out that there wasn't any actual evidence to support the premise that the iPad was used for copying music, but the court basically said "too bad" and "here, pay €5 million while we figure out the amount you'll actually owe:"

Apple argued as follows: the decision was not based on any hard data flowing from a study of actual use and merely replicated a previous decision applicable to mobile telephones, which decision was quashed for failing to properly carve out professional use....

[....] However, Copie France sought an award of a provisional amount, relying not on decision #13 but rather on the general statutory principle that such compensation is due. The Court agreed with this line of reasoning, noting that such principle was enshrined in both domestic and European law. It further noted that Apple, as supplier of the equipment at issue, was indeed the party that owed the levy. The Court thus fixed the amount of the provision at €5,000,000, to be applied against the final sum to be determined for the period between February and December 2011 (and ordered that its judgment be enforceable notwithstanding any appeal).

And, yes, technically, this tax is not supposed to be on "piracy" but on "legal copies" made, but everyone knows that argument is a smokescreen. The whole point of levies has really been to try to compensate copyright owners for copies they can't directly tax. And, while Apple will have to pay up here, you can bet this will end up coming out of consumers pockets, as always happens with copyright levies, which serve to (1) make innovative technologies more expensive and (2) build a giant bureaucracy where not much money ever actually goes back to artists.

from the and-if-you're-not-raking-it-in,-you're-not-interested-in-being-successful dept

Have you ever wondered how a tax auditor defines artistic success? Neither have I. In fact, it's probably one of the great unanswered questions, largely due to its status as one of the great unasked questions.

[The only thing I can think of that comes close to this intersection of red tape and artistic expression took place in 1990, when the members of the electronic/experimental rock band Legendary Pink Dots were denied visas to tour the US due to "lack of artistic merit." Apparently, the customs official was not familiar with the obscure rockers, despite a release schedule (32 albums, 52 live albums and compilations) that would choke The Fall.]

No one wants to be in this situation, but most people who find themselves facing an auditor are rarely subjected to unsolicited opinions and advice on how to run their businesses/careers better, along with countless flabbergasting statements about their industry in general.

“We’ve had several meetings with the auditor since November, and at the last one he said a preliminary determination had been made that we were hobbyists, not artists, and therefore could not write off our expenses,” said Venus, a visual artist, songwriter, bandleader and performer. “This has been unbelievably demoralizing. He basically is saying that if we really knew what we were doing, we should have been more profitable by now, and should have known to give up.

Charming. Apparently, Venus and her partner aren't successful enough to write off expenses. I guess that's a privilege left to artists with real careers and real expenses to write off. The auditors made the claim that any deductions for touring expenses were nothing more than the couple trying to write off personal vacations. Why would they draw this conclusion? Because they understand nothing about touring.

They also really don’t like that I tour. They say I tour way too much and that really, my name is already out there enough, after all this time in the business, there is now no need to do any promotional touring. I have this statement in writing. I attempted to show them, and tell them that this was the industry standard, approved, well-documented, way to build one’s fan base, to expand on it, to inspire interest in one’s work because of the direct contact one has with an audience. They replied that there’s no reason to return to the same cities and venues, and that I’m wrong, that I’m really touring only for pleasure and recreational reasons.

After "all this time in the business," the Rolling Stones are still touring. Perhaps they should stop. After all, their name is "already out there enough." Touring is the expectation when you're a musician. It can be a lifetime experience for some. Hopefully, these artists aren't a.) Minnesotans or b.) writing off touring expenses. (Nothing says "vacation" like a panel van full of equipment, band members and BO making a 6-hour run across the state on less than 2 hours of sleep. Relaxing!)

So, according to reps from the Minnesota revenue service, Venus DeMars hasn't achieved enough success to justify listing "artist" as an occupation, but is too successful to gain anything by touring. As an ideal, "success" is a pretty vague term. How do tax collectors define success in the music biz?

The tax guy said that by this point in my career I needed to be signed by a major label, that I should have been signed to a major label by now, that I needed to be signed to a major label to establish myself. [He said that] there was no evidence that I was actively sending my records to major record labels, so therefore I must not be interested in profit, and not running a for-profit business.

How delightfully old school. You can't spell success without the letters EMI (or UMG). While some musicians may not feel they've "made it" until they've signed away their rights to their creations signed with a major label, it's been a long time since the two terms were inseparable.

What we seem to have is someone (or someones) who don't understand the realities of the music business setting arbitrary ground rules on what constitutes a career in the music field, or at least what defines a career in terms of acceptable tax writeoffs. Touring is unimportant but a major label contract is everything. The auditors also made the claim that because DeMars allowed her music to be used on a public radio network (NPR), it meant she was uninterested in turning a profit.

Her partner, Lynette Reini-Grandell, didn't dodge the entire state vs. art "debate," either. The state's reps also questioned her business acumen as a writer.

The tone of all these proceedings have been completely anti-art. There has been an emphasis on creating a product, advertising it for sale, and then selling it. That’s not how it works on the creative end of literature. Writers need to spend a long time writing, getting feedback, moving up the levels of critique, and then they participate in the publishing industry by sending things out to publishers. One tries for the prominent ones first, gets rejected many, many times, and eventually finds a press and an audience.

Writers do not write a few lines and then advertise they have a poem for sale, making sure that the poem sells at a break-even point of what it cost monetarily to produce it. But this is what the Minnesota Department of Revenue insists I should be doing. It sickens me to have to participate in this because I know it is deeply wrong.

At this point, the state is telling the couple they owe over $100,000 in back taxes, an amount that may include a clawback of issued grants. This assessment seems to be based on the auditors' assertion that the couple simply isn't trying hard enough to make money. Based on what the state's representatives have said, not making enough money is the same as dodging taxes. But, even if you take the hardline and agree with the auditors' that the couples' livelihoods aren't sustainable without significant government assistance, you're still left with some unbelievably bad assumptions by the auditors and even worse career advice, all delivered in a thoroughly condescending manner. If the state is looking to recover these taxes, it needs to apply a more intelligent baseline than "stop touring and sign with a major label."

from the unconstitutional dept

Silly reactions to violent video games are coming so fast these days it makes one's head spin. Redundant labeling of games, doubling down on unconstitutional laws, and even special 1% taxes for games with a rating of "Teen" and above... It's quite difficult to parse out the well-intentioned silliness from the grandstanding silliness. What's clear, however, is that there are a great many people who don't recognize games as the speech that they are.

“That the general statutes be amended to establish a sales tax on the sale of video games rated “mature” at a rate of ten per cent on the entire sales price and to require the moneys derived from such sales tax be used by the Department of Mental Health and Addiction Services for the purpose of developing informational materials to educate families on the warning signs of video game addiction and antisocial behavior".

There is more than one problem with this type of legislation, but let's get the most obvious out of the way: it's likely unconstitutional. Courts have held in the past that both limiting violent games, as well as taxing specific types of speech differently than others, fails on constitutional grounds. Hovey's proposal would appear to violate both precedents. But even if that weren't the case, Forbes goes further in explaining how dangerously dumb this is.

This is of course punishing an industry based on conjecture, as no concrete evidence has yet been put forth linking video games and violent actions. The Obama administration’s new gun plans do involve the NHS studying this link, but as nothing is proven (and likely won’t be), video games should not be treated in the same way as a product proven to cause cancer.

I've said this before, but I will say it again: emotion is not a reliable basis for legislature. Ever. Data is what should drive laws and, in this case, the data is at best inconclusive and at worst non-existent. Proposing laws without data to perform the function that is supposed to be performed by parents is the height of a nanny state.